Correlation Between Chengdu Xingrong and Cultural Investment
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By analyzing existing cross correlation between Chengdu Xingrong Investment and Cultural Investment Holdings, you can compare the effects of market volatilities on Chengdu Xingrong and Cultural Investment and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Chengdu Xingrong with a short position of Cultural Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu Xingrong and Cultural Investment.
Diversification Opportunities for Chengdu Xingrong and Cultural Investment
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Chengdu and Cultural is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu Xingrong Investment and Cultural Investment Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cultural Investment and Chengdu Xingrong is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Chengdu Xingrong Investment are associated (or correlated) with Cultural Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cultural Investment has no effect on the direction of Chengdu Xingrong i.e., Chengdu Xingrong and Cultural Investment go up and down completely randomly.
Pair Corralation between Chengdu Xingrong and Cultural Investment
Assuming the 90 days trading horizon Chengdu Xingrong is expected to generate 1.25 times less return on investment than Cultural Investment. But when comparing it to its historical volatility, Chengdu Xingrong Investment is 1.42 times less risky than Cultural Investment. It trades about 0.09 of its potential returns per unit of risk. Cultural Investment Holdings is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 192.00 in Cultural Investment Holdings on September 24, 2024 and sell it today you would earn a total of 27.00 from holding Cultural Investment Holdings or generate 14.06% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Chengdu Xingrong Investment vs. Cultural Investment Holdings
Performance |
Timeline |
Chengdu Xingrong Inv |
Cultural Investment |
Chengdu Xingrong and Cultural Investment Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Chengdu Xingrong and Cultural Investment
The main advantage of trading using opposite Chengdu Xingrong and Cultural Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu Xingrong position performs unexpectedly, Cultural Investment can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Cultural Investment will offset losses from the drop in Cultural Investment's long position.Chengdu Xingrong vs. BeiGene | Chengdu Xingrong vs. Kweichow Moutai Co | Chengdu Xingrong vs. Beijing Roborock Technology | Chengdu Xingrong vs. G bits Network Technology |
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Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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